What did you find worse? Recession or cost of living crisis?

[ThemysteriousH]

This is not intended to cause offence

I know it’s rude to talk about money so I thought maybe asking strangers wouldn’t be so bad?

I’m early 30s so whilst I remember the recession it didn’t affect me directly as compared to me now with a household, bills and DC.

I’m personally struggling a lot, working full time, month to month, had a bit of 2023 living in a hostel homeless as my landlord sold up, but I know I’m blessed now with having a home, food, heating etc and that it could be SO SO much worse.
I wondered those that have lived through both as a grown up, has any felt worse?

I hope this post doesn’t come across as distasteful, I’m not very good with words I’ll be honest.

Hoping that 2024 will be better for us all 🤞

Both are dreadful but recession is the worst. With inflation your income does not go far enough, with a recession the danger is that you will loose your job and then have no money at all.

COL and Liz Truss’s fuckup last autumn, we now pay hundreds £ more for the mortgage. Also have bigger house and older children to feed etc.

If losing jobs is a market of Recession, we’re 100% heading that way. I know of lots of people losing their jobs and not able to walk into a new one easily.

But the inflation affects everyone whereas many people - most people - got through the last recessions without losing their jobs so most people were not affected as much ?

Recession.

I’m not yet 30 but I remember how awful the recession was for my family.

My mum had to take toilet roll from work as we couldn’t afford it at home and we had to walk everywhere that wasn’t to visit my grandparents. My lunch every day was a sandwich. Nothing else. Bloody awful. My dad had four jobs in one year.

COL has nothing on it tbh.

But, in part, that’s because my parents are now super financially savvy - didn’t overstretch on their house, saved loads etc. I am the same. Could have got a mortgage twice the size of what I did, but didn’t, just in case the economy tanked again. I’m sure I’ll get lambasted for it but a lot of people just don’t seem to plan for the worse - I.e mortgage hikes (I stress tested myself to 15%), bills going up, council tax going up etc.

Now for us is much worse. In the 2008 crash nothing really changed for us, other than our house value (when we sold in 2012 we sold for what we had bought it for in 2005, but at least we had paid into the mortgage for 7 years so wasn’t a total disaster as had a tiny amount of equity) But we kept our jobs etc.
Now although we have much more money coming in, the food and mortgage bills are astronomical. Our mortgage went up £500 overnight and our food bills are almost double what they were in 2020. Plus everything else like diesel etc. it’s horrific.

Recession

We’re in a sector where recessions hit hard and 2008 around 25% of it disappeared. Nearly every SME making many redundancies.

Low unemployment is important, the opposite is very tough

COL is way harder to live through. During the recession it was more about there not being enough jobs and thousands applying for each one. I was out of work for 2 years and applying to everything I could find and getting nowhere.

Benefits were tight and I went into debt but I never went without food or heating and was able to pay back debts within 3 months of finally getting a job.

I got sick after a year and I've been on max disability benefits for over a decade now and I've never struggled this much. I'm down to one meal a day and owe over £3k to OVO that I have no hope of finding any time soon.

This has nailed the main difference:

My experience was that recessions do not treat people equally, some people lose everything and some people are barely impacted

During the cost of living crisis everyone has been affected by rising prices, although some of course can still happily afford what they need without worry, it's still something they'll be aware of etc. During a recession its savage AF for some ie if you lose your job which is more likely to happen during a recession, but it won't be felt across the board in the same way. Both are horrible so not minimising either.

Yes. Which sector you are in will likely be a factor

Private sector might be more likely to say recession and public CoL

Definitely the col crisis. I lost my job in the recession and couldn’t find one that paid as well, but it was okay because with dh’s wage we could make it work. This time dh has lost his job and there is literally no wiggle room because everything is so expensive, it’s really tough out there at the moment.

This is worse but as a consequence of nearly losing my family home in the late 80s recession we decided to and were fortunate enough to be able to buy the home we live in on one income and I was able to stay at home for a couple of years with my child. Therefore when this cost of living crisis began I was able to start working full time and maintain our standard of living. I'm 45 so I've lived long enough to know the cycles . Our house is much smaller than friends who stretched themselves in times of low interest rates and now we feel very relieved that we didn't buy large ourselves.

I graduated into the 2008 recession. It was really hard, all the temping jobs I'd been doing during uni holidays had dried up and of course there were no graduate jobs. I moved away from London because it was all just too precarious, and so lost out on access to the interesting jobs which instead went to young people who could live with London-based family for free and so accept poverty wages or long periods of volunteering to get their start.

The cost of living crisis has been much easier as I happened to get a new job with a decent pay bump right at the start of it and made a deliberate effort not to lose the extra pay to lifestyle inflation. We could have moved somewhere nicer but opted to stay put and overpay the mortgage, which means that when our fix ends we won't be facing a huge jump in outgoings. We've even managed a nice holiday and some expensive home repairs without getting into debt, which feels phenomenally good. Having said all that I work in local government in a non statutory role so unless things change at a national level pretty soon we could still find ourselves in a pickle.

These economic crises are easier to weather if you're already comfortable. If I'd been established in my career in 2008 or I came from money I'd have been affected less. If we were renting now, and had to deal with the huge rental costs inflation that's been going on in our area, we'd be fucked without my lucky pay bump and struggling even with it.

We are definitely feeling it now more. I also think the 1980's recession was worse, more of my mum and dad's friends lost their jobs then any of our friends in 2008. Also with the interest rates being high it was really bad.

Maybe due to where we live but in 2008 there where still jobs and yes the house prices stalled but the drop was minimal here. It didn't really effect us at all as we both still had jobs.

I think the cost of living is going to lead to a recession, they have already had a round of redundancy at DH work and let all there temporary contract staff go. It is due to global pressure as well but I can see that happening with more industries soon.

"These economic crises are easier to weather if you're already comfortable."

I agree with littlegrebe. Much depends on your starting point, the sector you work in, existing financial commitments, dependents etc.

It took us quite a while to recover from 2008 but CoL has certainly had a significant impact.

These answers are really insightful thank you - I do feel a bit dim not fully understanding.

Looking back, with the recession the family members I lived with had a farm paid off and jobs such as teaching/MOD, so maybe that’s why I don’t remember the recession as badly, compared to me now alone with 2 DS etc

I appreciate every answer, thank you.

The recession was awful. My husband's business dried up overnight, we had our first in 2009, couldn't put it off because I was already 35. I had crappy maternity benefits. We got in to a lot of debt. We didn't have enough money for oil so the house was very very cold for a few winters as it is an old farmhouse. No money for clothes or any days out, certainly no holidays. BUT, I am sort of glad we lived through it. It was a hell of a shock, but got very good at budgeting and cooking. We are not very materialistic at all. We had only just finished paying off the mortgage arrears from that time in 2022 when the cost of living crisis started to rear up. I had/have a sort of confidence that we will be ok. We have weathered it once, we will somehow get through it again.

We have no savings, my husband has no pension and is a lot older than me, but we had to pay off debts. So the consequences of the recession are still real for us, but we don't worry too much about it. I have a reasonable job and we just keep going and hope for a better future.

Really interesting question and answers, OP!

For me, the 2008 crash was way worse.

I'm another one who graduated university during that time and all graduate, entry-level and even temping jobs just disappeared. It took me years to get a full-time job. I was lucky to be able to move back in with my parents, but with no job I couldn't save anything, which made life feel pretty miserable and is also why it took me so long to get on the housing ladder.

I've felt the pinch in this CoL crisis as I now have a mortgage and DC, but I've still got my job so it's been much, much easier. (I also took out a very conservative mortgage.)

It took far longer to find a job in the recession than it would now, but I am in a huge shortage sector, which was far more competitive at the time. I remember really panicking when I finished university as a single parent and being down to my last few pounds while responsible for a child. But once I found a job, I was laughing. The tax credits system meant I was netting more than many of my colleagues who earned far more than me on paper, but without the top-ups, and life was very comfortable. Benefits now are far less generous.

The CoL crisis hits in a different way. Many of my friends and collagues suffer more, because they stretched themselves with what was available, so their mortgages are through the roof, let alone the bills for maintaining their houses. I notice it more with food; my food shop has doubled in price. However, I am still able to save a significant amount of money each month, which I am doing as a buffer, so even when shitstorm after shitstorm hits as it did in 2023, I can still somewhat weather it all.

But I now earn far more than I did during the recession, live in a cheap house in a dodgy area, my bills are on the low side due to the type of house I have and I live close enough to work that fuel isn't a huge issue. If you have lived well within your means before the CoL crisis hit, you're fine, while those who stretched themselves and live in bigger houses in better areas are not fine.

TL;DR Neither has affected me too much, but I was and am very lucky.

2008 as well.
Just had a baby and relying on dh wage and sole earner thankfully he kept job but many on his team lost their job.
This also meant he was stuck in low paying crap job as he was scared to leave it.
This cost of living hasn't really impacted us in a huge way because our energy bills didn't change much I don't know why? We had 2 years prior had something renovation and got low energy appliances. Also we faced it on two wages.

I am 48 now, definitely the recession was worse. Money was so very tight, I had to watch every penny. This col is shite too but different for me as I feel I can control my situation better but with the recession I couldn’t.

The mid-70s financial crisis was far worse.

Recession. I was made redundant (although luckily found something else very quickly) and was unmarried and earning far less. I'm in a much more secure position now but I know what it would be like if this had happened back then.

Definitely recession. I was job-hunting for a graduate role in 2011 and whole sectors were basically no-go so I settled for a career where there were (some) jobs. I even did a Masters partly to buy myself more time to find a job!

CoL has been okay so far, as I didn’t overstretch myself beforehand, but I have noticed the drop in standard of living from it.

With cost of living I can somewhat control the impact by really limiting spending, and it’s easier to make a bit more money freelancing.

The recession was horrible. While I didn’t lose my job my salary stagnated for a good 10 years in the public sector and moving jobs was a scary prospect because of the lack of job security. If I had lost my job I would have had a reasonable redundancy package which wouldn’t be the case in a new role. I have friends who are still dealing with the financial impact of multiple redundancies in the space of 2 years, along with falling house prices leaving them in negative equity.

Paying more for basics I can deal with, unemployment is a different kettle of fish altogether.